MercadoLibre (NASDAQ:MELI) executives highlighted “robust operating trends” to close 2025, driven by faster growth in its commerce business, expanding fintech adoption, and an increasing contribution from artificial intelligence tools, according to the company’s fourth-quarter earnings call for the period ended Dec. 31, 2025.
Chief Financial Officer Martin de los Santos said fourth-quarter net revenue rose 45% year-over-year, supported by “the acceleration of our commerce business and the rapid adoption and structural expansion of our fintech services.” For the full year, revenue grew 39% and income from operations rose 22%, with margin compression reflecting investment decisions centered on shipping and credit card expansion.
Commerce growth accelerates in Brazil and Mexico
Mexico also posted 35% GMV growth, according to prepared remarks. Ariel Szarfsztejn said the latest reduction in Brazil’s free shipping threshold produced results consistent with prior iterations, citing “record conversion rates” and “record retention rates” for both new and existing buyers, along with peak net promoter score (NPS) levels in Brazil. He noted items sold growth accelerated from 26% year-over-year in Q2 to 42% in Q3 and 45% in Q4, while GMV growth moved from 29% to 34% to 35% over the same period.
On unit economics, Szarfsztejn said shipping cost improvements came from volume leverage, use of idle capacity through a “slow shipping network,” and continued gains from technology and productivity initiatives, adding that management did not see a reason those improvements would not continue, while acknowledging more work remains.
Investments weigh on margins, but executives emphasize long-term approach
On the call, de los Santos discussed a range of investments the company said created an estimated 5 to 6 percentage point impact on margins. Those included:
- Lowering the free shipping threshold in Brazil
- Credit card investments in Brazil and Mexico, with expansion into Argentina
- First-party (1P) retail, which management said is improving but “still not profitable on its own”
- Cross-border trade (CBT), including expansion into China and U.S. corridors
- Continued investment in smaller markets as operations scale
De los Santos said locally fulfilled cross-border can be profitable, while international fulfillment still needs scale and will continue to pressure margins as it grows. He also said 1P is profitable on a variable basis before central cost allocation, and that scale should continue to help profitability improve.
When asked about balancing strong growth with margin pressure in Brazil, de los Santos said management is “not trying to optimize short-term margin,” emphasizing a long-term strategy focused on capturing opportunities in commerce, fintech, and advertising even if that brings near-term margin pressure.
AI adoption expands across ads, acquiring, and customer support
Executives repeatedly emphasized AI as a catalyst for growth and efficiency. In advertising, the CFO said AI-driven bidding and automated campaign tools improved seller returns, boosting adoption and helping the ads business grow 67%.
Szarfsztejn said the ads acceleration was broad-based and driven by improvements across the “tech stack,” including auction and bidding, placement optimization, demand generation initiatives, and front-end usability. He highlighted tools such as “Budget Orchestrator,” seasonal “budget boost” recommendations powered by predictive signals, performance-driven recommendations, and AI agents that support advisors and engage directly with sellers to increase adoption among mid- and long-tail merchants. He added that ad revenue as a percentage of GMV remains small relative to its potential.
In payments acquiring, the CFO said AI tools helped identify high-value merchants faster in Brazil, contributing to acquiring total payment volume (TPV) growth of 25% in Brazil and 50% in Mexico. Later in Q&A, management clarified that on-platform payment activity is reflected in marketplace economics, while acquiring results reflect online and offline merchant services. Executives said online acquiring typically carries a higher take rate than point-of-sale transactions due to higher risk and complexity. Management also said a proposed interchange cap in Mexico “did not go through” and was postponed, meaning no change “for the time being.”
In customer support, executives said the Mercado Pago AI assistant is resolving 87% of interactions without human support. The company described the assistant as already capable of handling many tasks users would typically perform in the app, such as pulling upcoming invoices and paying them via conversation. Management said it has not yet used the assistant for cross-sell, but expects it to become more proactive over time in suggesting offers and acting “like a personal banker.”
On the marketplace side, Szarfsztejn said MercadoLibre already has a seller assistant, and management said about 20% of GMV is “somehow advised” by it, helping sellers improve listings, reduce lead times, and manage customer support.
Fintech milestones: NPS leadership, credit portfolio growth, and deposits engagement
Management said Mercado Pago achieved NPS leadership in Brazil and Mexico, Argentina and Chile, and that monthly active users have been growing close to 30% for 10 consecutive quarters. The credit portfolio “nearly doubled” year-over-year to $12.5 billion, with nearly 3 million new credit cards issued in Q4 alone. Assets under management were said to be close to $19 billion, up 78% year-over-year.
Executives also discussed deposits growth in Brazil, saying Mercado Pago is “mostly” not using deposits to fund credit and is not engaging in fractional banking. However, management said users with “pots” and higher balances show materially higher engagement, including more transactions and greater use of credit products.
On credit performance, management said credit card net non-performing loans (NPLs) fell to an all-time low of 4.4% in Q4, while a sequential increase in NPLs was tied to consumer and merchant books. Executives emphasized net interest margins (NIMs) improved quarter-over-quarter, attributing that to pricing risk accordingly and booking expected losses in advance. When asked about whether higher risk-taking could drive future NPL increases, management said it does not provide guidance and reiterated comfort with its risk posture and models.
On credit card issuance, MercadoLibre said it issued nearly 3 million cards in Q4, up from 2 million in Q3 and 1.5 million in Q2. Management attributed the Q3 step-up mainly to Brazil model improvements, and said Q4 growth reflected acceleration in Mexico and a ramp in Argentina, where it issued “a few” hundred thousand cards as the rollout gained pace. Executives added that Brazil cohorts older than two years are profitable at the NIM level, though the overall credit card book is not yet profitable on average as new users are added.
In closing remarks, de los Santos said MercadoLibre delivered record market share gains in commerce in Brazil and Mexico during 2025, alongside acquiring gains in fintech and continued scaling of the credit portfolio. He also said the company reached record NPS in commerce and fintech across Brazil, Mexico, and Argentina, positioning the business to sustain growth into 2026.
About MercadoLibre (NASDAQ:MELI)
MercadoLibre, Inc operates an integrated e-commerce and fintech ecosystem serving consumers and businesses across Latin America. The company provides an online marketplace that connects buyers and sellers for a wide range of goods and services, supported by tools for merchants, advertising, and classifieds. Over time MercadoLibre has expanded beyond its marketplace roots into complementary areas that support digital commerce end to end.
Key offerings include its marketplace platform and a suite of logistics and payment services.
